How Smart Investors Look at Urban One (UONE).

Urban One logged a 0.7% change during today's morning session, and is now trading at a price of $5.08 per share.

Urban One returned losses of -10.0% last year, with its stock price reaching a high of $8.04 and a low of $4.33. Over the same period, the stock underperformed the S&P 500 index by -24.0%. As of April 2023, the company's 50-day average price was $5.37. Urban One, Inc., together with its subsidiaries, operates as an urban-oriented multi-media company in the United States. Based in Silver Spring, MD, the small-cap Consumer Discretionary company has 881 full time employees. Urban One has not offered a dividend during the last year.

The Company May Be Profitable, but Its Balance Sheet Is Highly Leveraged:

2017-03-10 2018-03-16 2019-03-18 2020-04-29 2021-03-31 2022-03-15
Revenue (k) $456,219 $440,041 $439,098 $436,929 $376,337 $441,462
Operating Margins 19% 12% 17% 20% 31% 27%
Net Margins 0.0% 25.0% 32.0% 0.0% -2.0% 9.0%
Net Income (k) -$423 $111,887 $141,001 $925 -$8,113 $38,352
Net Interest Expense (k) -$81,422 -$79,220 -$76,427 -$81,250 -$74,294 -$65,484
Depreciation & Amort. (k) -$34,247 -$34,016 -$33,189 -$16,985 -$9,741 -$9,289
Earnings Per Share -$0.01 $2.25 $2.94 $0.02 -$0.18 $0.7
EPS Growth n/a 22600.0% 30.67% -99.32% -1000.0% 488.89%
Diluted Shares (k) 47,925 49,633 48,001 47,922 45,041 55,080
Free Cash Flow (k) $53,413 $33,752 $42,266 $50,150 $76,805 $78,436
Capital Expenditures -$5,164 -$5,445 $7,963 $8,355 -$2,938 $1,714
Net Current Assets (k) -$1,217,842 -$1,063,585 -$878,837 -$870,241 -$772,922 -$676,699
Long Term Debt (k) $1,002,736 $967,166 $873,757 $850,308 $818,924 $818,616

Urban One has exceptional EPS growth and a pattern of improving cash flows. Additionally, the company's financial statements display an excellent current ratio and decent operating margins with a positive growth rate. However, the firm has high levels of debt. Finally, we note that Urban One has weak revenue growth and a flat capital expenditure trend.

Urban One Has Attractive Multiples and Trades Below Its Graham Number:

Urban One has a trailing twelve month P/E ratio of 7.5 compared to the Consumer Discretionary sector's average of 22.33. The company doesn't provide forward earnings guidance, and the compound average growth rate of its last 6 years of reported EPS is 104.4%. On this basis, Urban One's PEG ratio is 0.07. Using instead the 11.7% weighted average of Urban One's earnings CAGR and the broader market's anticipated 5-year EPS growth rate, the company's PEG ratio is 0.64, which implies that its shares may be underpriced. Additionally, the market is possibly undervaluing Urban One in terms of its equity because its P/B ratio is 0.73 whereas the sector average is 3.12. The company's shares are currently trading -42.4% below their Graham number.

Overview of Urban One's Market Factors:

Urban One has a very low short interest because 0.3% of the company's shares are sold short. Institutions own 40.5% of the company's shares, and the insider ownership rate stands at 11.1%, suggesting a decent amount of insider shareholders. The largest shareholder is Zazove Associates LLC, whose 6% stake in the company is worth $2,974,775.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.